What Is the Most Common Way That Agency Conflict Problems

question 79

Multiple Choice

What is the most common way that agency conflict problems are addressed in most corporations?

• A)by minimizing the number of decisions that a manager makes where there is a conflict between the managers interests and those of the shareholders
• B)by terminating the employment of employees who are found to have put their own interests above that of the company's
• C)by using disinterested outside bodies to adjudicate between managers and shareholders when such conflicts arise
• D)by prosecuting managers who have been found to have illegally used company moneys for their own benefit

---

Definitions:

Long-Term Financing

Funding obtained for a time period exceeding one year, used for acquiring or investing in long-duration assets.

Conservative

In finance, conservative refers to an investment strategy or financial decision-making approach that prioritizes preservation of capital and minimizes risk.

Net Working Capital

The disparity between an organization's immediate assets and liabilities, showcasing its financial stability in the short-term.

Accounts Payable

Short-term liabilities or the money a company owes to suppliers or vendors for goods and services that were purchased on credit.